An Estimation Of Disposable Personal Income Of The Spanish Municipalities In 1997

Since 1992, Lawrence R. Klein Institute –Autónoma University of Madrid- estimates the disposable income of the Spanish municipalities, recently published in the ‘Anuario Comercial de España’ –Spanish Trade Yearbook- as scaled levels. Municipal personal income has been considered as one of the most important economic indicators, very used in a wide range of studies concerned with regional convergence, welfare analysis, marketing targets, etc. This kind of estimation can be carried out by both direct and indirect methodology. The first proceeding requires a huge information database generally difficult to obtain and not always precise, which main defect is that it cannot reflect the underground economy of Spanish municipalities. That is why direct methodology always has needed the help of indirect proceedings. These last ones find out the statistical relation of the personal disposable income and a group of socio-economic indicators for all the geographic units considered, municipalities, provinces, regions, countries, etc. In this paper, the authors present some of the indirect methods used to estimate the disposable income of Spanish municipalities. Especially the Klein estimation combines some multivariate analysis –panel data, factor and cross-section regression analysis- with a big database of almost 200 socio-economic indicators. The final estimation of the 8.099 municipalities disposable income allows us to acquire a better knowing of Spanish micro-territorial development.